Indonesia produces an enormous amount of nickel. Let me ask you to guess: what percentage of the world's total nickel production comes from here?
Fifty-five percent.
More than half—from a single country. This mineral is a critical component in modern electric vehicle batteries. Nickel forms the spine of cathode material. The higher the nickel content, the more energy-dense the battery, the farther a vehicle can travel.
It sounds great, right? We have access to a valuable resource at a time when the world increasingly needs clean energy and electric vehicles.
Here's a simple question: how many EV batteries are produced in Indonesia?
The answer is: very few.
The vast majority of EV batteries used in vehicles across Indonesia—whether imported as components or as part of finished vehicles—come from China. That's an observation, not a judgment.
China now controls 69 percent of the global EV battery market. CATL alone—one company—has 39 percent of global market share. BYD is second with 16 percent. Third and fourth are also Chinese. Indonesia doesn't make the top ten.
This is a striking paradox. We have the raw material that forms the foundation of the entire supply chain. But we don't transform that material into high-value products.
Instead, China takes our nickel, processes it, transforms it into finished batteries, and exports it back to us—capturing massive profit margins at every stage.
Why does this happen? It's a fair question. And the answer is complex.
Let's break down what's required to become a battery manufacturer.
The obvious first requirement is raw material. We have nickel. But raw nickel doesn't directly become battery material. Nickel needs to be processed. Refined. Converted into battery-grade material with precise chemical properties. This requires sophisticated technology like HPAL—High Pressure Acid Leaching—or other complex methods. It requires refineries that are sophisticated, quality control that is strict, and expertise that can't be developed overnight.
Indonesia only recently started investing in this infrastructure. We have five HPAL facilities operational now in 2026. That's genuine progress. But at the same time, China already has hundreds of refineries and processing plants that have been running for decades. They have mature optimization. They have redundancy. They have supply security.
So the gap in the first stage—from ore to battery-grade material—is already large. But it's not even the biggest bottleneck.
The second requirement is manufacturing expertise and engineering complexity of the battery itself.
A battery isn't just pure chemistry in a beaker. It's engineering. You need thermal management—understanding how heat from high-current discharge distributes and dissipates. You need electrical safety—how cells integrate without short circuits. You need to understand failure modes—what could go wrong, and how design prevents it.
You need extreme manufacturing precision. Cell geometry, separator thickness, electrolyte distribution—all must be consistent within microns. If not, cells can develop internal short circuits or uneven current distribution, leading to premature failure or thermal runaway.
None of that can be mastered in two years. It's expertise built through decades of trial and error, scale-up, and iteration.
China already did this. Companies like CATL didn't succeed overnight. They started with massive investments in R&D, manufacturing infrastructure, training, building intellectual property. Over time, they became the dominant global player.
Indonesia? We're just beginning seriously at this stage.
Third—and this might be the most underestimated—is the ecosystem.
A battery isn't a standalone product. When an EV manufacturer or automotive company wants to produce vehicles, they don't just need finished batteries. They need SUPPLIERS that are trustworthy, with proven track records, who can deliver consistent volume, with strict quality assurance, with sophisticated logistics and inventory management.
China has an entire ecosystem of this. When CATL or BYD produce batteries, there's an ecosystem of thousands of large and small suppliers integrated. There's standardization. There are relationships established over years. There's redundancy so if one supplier goes down, there's a backup.
Indonesia? If I'm an automotive manufacturer and I need a proven battery supplier, who do I contact? Our industrial base for battery manufacturing isn't mature enough to be a reliable supplier for global OEMs.
Building that ecosystem takes time—not just building one factory, but building the entire ecosystem.
Now for the numbers. Indonesia targets becoming a top-three battery producer globally by 2027. Ambitious. We're investing. The government is pushing joint ventures with China. The "Dragon" project—a joint venture between Antam, Indonesian Battery Corporation, and CATL—plans to build multiple facilities in East Halmahera and a large battery plant in Karawang operational by late 2026.
That's good. That's the right move.
But here's what's important: this is just the first stage. One or two factories aren't enough to become a "top-three producer." That's just a starting point. To sustain top-three status, we need multiple facilities, a skilled workforce, R&D capability, supply chain security, market access. All of that takes time.
If we only build factories and let China handle the expertise, we risk becoming a manufacturing base for China—lower margins, lower control, lower independence.
There's a bigger lesson here worth reflecting on. Natural resources—nickel, oil, gas, anything—are the BEGINNING of a value chain, not the end. The real value—profit, employment, technological advancement—is created in manufacturing and engineering and innovation.
Countries that only export raw materials stay at low value. Countries that build manufacturing and engineering capability capture most of the value.
Vietnam started later than we did, but they invested heavily in the EV ecosystem. VinFast developed their own vehicles. They partner with battery makers, but with strategic interest—not just as a dumping ground for imported batteries.
Indonesia still has time. The window for catch-up is still open. But it's shrinking.
2 April 2026
Potato Codex
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